There are actually a fair amount of Canadian dividend stocks offering high yields right now. Yet the key here is the reliable income. If you’re going to make an investment right based in large part on a dividend, you’d better be sure that dividend will continue to pay out — especially over the long term.
That’s why today, I’m looking at three dividend stocks that have proven their worth. Each has a high dividend yield to consider as well along with a solid path for growth.
Slate Grocery REIT
Slate Grocery REIT (TSX: SGR.UN) continues to be a solid choice for investors seeking high dividends and passive income. And it’s certainly undervalued. Slate stock currently has shares down 17% year to date, trading at 6.56 times earnings as of writing.
Now, inflation and interest rates seem to be the reason investors are concerned with the stock. However, that might be a mistake. Slate stock instead is one of the dividend stocks in the real estate industry that offers solid dividend payouts. This is because the company invests in grocery chains and is linked to large and small brands across the United States.
These lease agreements are also long for the most part — about five to 10 years on average. Here in Canada, there is simply no competition for Slate stock to edge in on. So, its diversified collection of grocery chains allows for long-term income and lease agreements for investors to consider. Currently, the stock holds a 9.29% dividend yield.
TransAlta Renewables
Renewable energy is certainly the future, but what about the present? That’s why among Canadian dividend stocks I like TransAlta Renewables (TSX: RNW). It offers a diversified range of energy production, from wind and hydro to renewable gas in the United States and Australia.
Shares of TransAlta stock are down a whopping 27% in the last year, plunging before the new year as interest rates and costs only went up, leading to quarter after quarter of missed earnings. However, since the beginning of 2023, investors seem to be back on board with shares up 12% in that time.
Now, investors can bring in this with their other dividend stocks with a dividend yield at 7.36% as of writing.
CIBC stock
Finally, the Big Six banks are certainly not doing well. And, if I’m totally honest, Canadian Imperial Bank of Commerce (TSX: CM) may get worse before it gets better. That’s at least what analysts have been saying, as the Canadian-focused bank continues to trade down 18% in the last year.
But the bank doesn’t seem worried, recently increasing its dividend yet again. That’s likely because of provisions for loan losses. Further, there is an oligopoly in Canada that these banks enjoy. In the case of CIBC stock, the Canadian focus actually works well for it. There are less losses from exposure to other countries, with Canada not going through a bank crisis since 1840.
Shares of the stock now trade at 11.37 times earnings, with a dividend yield at 6.13%. So, really, I would see this as a major deal, as shares are likely to surge back to pre-drop prices in the next few months.
